Investing.com - The Australian dollar edged higher against its U.S. counterpart on Wednesday, but gains were expected to remain limited as markets were jittery ahead of the Federal Reserve's highly-anticipated policy statement due later in the day.
AUD/USD hit 0.7216 during late Asian trade, the session high; the pair subsequently consolidated at 0.7199, adding 0.10%.
The pair was likely to find support at 0.7156, the low of December 14 and resistance at 0.7285, Tuesday's high.
Most investors expect the U.S. central bank to raise interest rates for the first time since June 2006 at the conclusion of its meeting on Wednesday.
Higher interest rates would make the U.S. dollar more attractive to yield-seeking investors in the long run, but a rate hike could also trigger dollar selling in the immediate aftermath.
With a rate hike priced in investors are now focusing on how quickly the Fed will tighten monetary policy in 2016. The Fed has indicated that the pace of rate hikes will be gradual.
The Aussie was lower against the euro, with EUR/AUD edging up 0.11% to 1.5209.